Oil regulator okays Ambani firm pipeline tariff

Oil regulator PNGRB today approved the tariff that Mukesh Ambani-owned East-West pipeline will charge for transporting gas from Reliance Industries' eastern offshore KG-D6 fields to users.

Against a levelised (or average) tariff of Rs 53.64 per million British thermal unit sought by Reliance Gas Transporation and Infrastructure Ltd, majority owned by RIL Chairman Mukesh Ambani, the Petroleum and Natural Gas Regulatory Board (PNGRB) today approved a provisional tariff of Rs 52.23 per mmBtu.

The Board, however, asked RGTIL to divide the Kakinada (in Andhra Pradesh) to Bharuch (in Gujarat) pipeline into three tariff zones as against two proposed by the company and apportion the levelized tariff.

RGTIL charged Rs 15 per MMBtu tariff for transporting gas in zone-1, i.E. Andhra Pradesh. For states between Andhra and Gujarat, it charged Rs 61.77 per mmBtu. The levelized or average of the two came to Rs 53.64 per mmBtu.

PNGRB's order asking RGTIL to have three zonal tariffs would mean that it will charge different transportation fee for ferrying gas to users in Andhra Pradesh, Maharasthra and Gujarat.

In effect, users in Maharasthra like the Dabhol Power Plant will have to pay less than those in Gujarat. Currently, users in both states pay the same tariff.

"The provisional initial unit natural gas pipeline tariff on levelized basis determined by the Board shall be Rs 52.23 per mmBtu with effect from the date of commissioning of the natural gas pipeline ie April 1, 2009," the PNGRB order said.

The difference between the tariff charged till now and that approved by the Board would be adjusted retrospectively with customers.

"The apportionment of the levelized tariff over all the tariff zone with detailed calculations will be submitted by the entity (RGTIL) for Board's approval within 10 days of the issue of this order," it said.

PNGRB said it will give the final tariff "once the audited cost and financial data" of the the pipeline was available.